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Board to Revisit Occupancy Regulation

By Jorge Casuso

Dec. 13 -- Hoping to surmount a legal challenge, the Rent Control Board will consider a major change to a new regulation that allows landlords to raise rents to market rates if they can prove the tenants are not using their apartments as a primary residence.

Under the proposed change presented to the board last Thursday, the board, and not the landlords, will determine the new rental rate based on the rent of comparable units.

The change -- which will be taken up by the board next month -- comes three weeks after prominent developer Robert Bisno, who lives in an exclusive Beverly Hills neighborhood and rents a rent-controlled apartment in Santa Monica, challenged the new regulation.

Bisno argued that the regulation goes against the Rent Control Charter and that voters must approve such a major change. On November 19, a trial court enjoined the board from enforcing the regulation.

The court held that the law "requires the board to set rents and not delegate that to landlords and that there is no requirement that landlords set the rent at 'fair and equitable levels,'" said Doris Ganga, the board's general counsel.

Under the proposed change, a hearings officer and the board would set the new rent based on the median rents of comparable units vacated on the property during the previous three years. If there are no such units on the property, the new rent would be based on the median rents of comparable units in the area.

The provision allows landlords and tenants to challenge the new rates if the amenities or condition of the unit is substantially different from that of the comparable units. Either party can set a hearing and must provide the board with reasons in writing for that adjustment.

Bisno's attorney, Allan Abshez, told the board that the proposed change would not "salvage" the new regulation, which is displacing tenants from their homes.

"It seems to us that this is rather a very hasty reaction to the court's decision," Abshez said. "It will not salvage the regulation. It would simply cause more disruption in litigation.

"The proper course is to put that proposition to the voters," Abshez said. "That's a legislative policy. It's not an exercise in rent control. That was the proper course, and we still believe that's the proper course… We think this is just going to prolong a conflict."

Attorney Rosario Perry, who has represented several landlords under the new regulation, believes the proposed change would prolong an already lengthy process if the new rental rate is challenged.

"This could take half a year easy, so the apartment is tied up for half a year," Perry said.

Nearly 120 cases have been filed with the board since the regulation went into effect on March 15.
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